Financing Homes in Lake Tahoe and Truckee since 1992.

Lake Tahoe Mortgage Rate Trends- March 3, 2015

Tuesday’s bond market has opened in negative territory despite early weakness in stocks and no relevant economic data set for release. The major stock indexes are showing noticeable losses with the Dow down 87 points and the Nasdaq down 34 points. The bond market is currently down 4/32 (2.10%), which with yesterday afternoon’s weakness should push this morning’s mortgage rates higher by approximately .125 – .250 of a discount point.

There is nothing scheduled for today that is expected to drive bond trading or mortgage rates. It is the only day of the week with nothing set that we need to watch. On days like this, we normally turn towards stocks as the likely force behind bond direction. However, with stocks well in negative ground and bonds following suit, it looks like it is going to be a lost day altogether. If stocks do recover their morning losses, it is difficult to expect bonds to rally with them. So, we will write the day off and turn our attention to tomorrow’s activities.

Payroll processor ADP will announce their February change in private-sector payrolls processed at 8:15 AM ET tomorrow. Since it is not a government agency report, it isn’t considered to be highly important however, as with any employment-related data it does draw some attention. This is especially true for this report because it is posted just a couple days before monthly employment figures are released by the Labor Department (Friday). I personally believe it is given more attention than it really deserves, particularly because many use it to predict the monthly government figures but often fail miserably. Still, if it shows a noticeable variance from expectations, it will likely cause movement in the markets and mortgage rates. Analysts are expecting to see 220,000 jobs added. The lower the number, the better the news it is for bonds and mortgage rates.

The Fed Beige Book will be posted tomorrow afternoon. This report, which is named simply after the color of its cover, details economic activity throughout the country by Federal Reserve region. The Fed relies heavily on this data during their FOMC meetings, so look for a potential reaction following its 2:00 PM ET release. It probably will not cause a major sell off in the stock or bond markets, but it is still worth watching.

Also worth noting are several speaking engagements from current Fed members. The markets always watch their words for any hint at the Fed’s next move, but unless we get a major surprise I don’t see any of them significantly affecting tomorrow’s mortgage rates.